MADISON METROPOLITAN SEWERAGE DISTRICT. 1. Opening (8:00 AM 8:05 AM) A. Call to Order B. Welcome guests and visitors C.

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1 MADISON METROPOLITAN SEWERAGE DISTRICT 1610 Moorland Road Madison, WI Telephone (608) Fax (608) D. Michael Mucha, P.E. Chief Engineer & Director COMMISSIONERS Caryl E. Terrell President Thomas D. Hovel Vice-President Ezra J. Meyer Secretary John E. Hendrick Commissioner Topf Wells Commissioner NOTICE OF COMMISSION MEETING PLEASE TAKE NOTICE that there will be a regular meeting of the Commission of the Madison Metropolitan Sewerage District at 8:00 a.m., on Thursday, June 13, 2013 in the Commission Room of the Operations Building at 1610 Moorland Road, Madison, Wisconsin The Commission will consider and may take action on the matters set forth on the attached Agenda. If any matter on the Agenda is to be considered in closed session of the Commission, please be advised that following the closed session the Commission will reconvene into open session for purposes of concluding its Agenda. Date: June 7, 2013 D. Michael Mucha, P.E. Chief Engineer and Director Any person who has a qualifying disability as defined by the Americans with Disabilities Act that requires the meeting or materials at the meeting to be in an accessible location or format must contact the Director at , 1610 Moorland Road, Madison, Wisconsin, at least twenty-four hours prior to the commencement of the meeting so that any necessary arrangements can be made to accommodate each request. 1. Opening (8:00 AM 8:05 AM) A. Call to Order B. Welcome guests and visitors C. Announcements 2. Appearances by the Public (8:05 AM 8:06 AM) 3. Consent Calendar (8:06 AM 8:10 AM) Approval of Commission Meeting Minutes from Approval of Cash Statement-Operating Fund Approval of Cash Statement-Capital Projects Fund Click Here: Monthly Credit Card Listing 4. Review and Approval of Sewer Extension Plans (8:10 AM 8:20 AM) Sauser Click Here: Commission Agenda Report Scenic Ridge-Phase 5, City of Verona Uptown Village, City of Fitchburg

2 5. Review and Approval of Construction Phase Engineering (8:20 AM 8:25 AM) Borelli Services-PS18 Click Here: Commission Agenda Report 6. Authorization to Proceed with Agreement for Lower Badger Mill Creek Interceptor-Phase 3 (8:25 AM 8:30 AM) Click Here: Commission Agenda Report Click Here: Attachment-Map Borelli 7. Acceptance of Work-Operations Building HVAC Rehabilitation (8:30 AM 8:40 AM) Hjellen Click Here: Commission Agenda Report Click Here: Attachment-Resolution 8. Approval of Financial Policies (8:40 AM 8:55 AM) Brochtrup Click Here: Commission Agenda Report Click Here: Attachment-Draft Financial Policies 9. Capital Projects Financing Options (8:55 AM 9:00 AM) Brochtrup Click Here: Commission Agenda Report 10. Oral Reports and Updates (9:00 AM 9:10 AM) Staff A. Capital Projects Update-Simon B. CARPC Update C. Chief Engineer and Director Report-Mucha Meeting Schedule as of 6/10/ Future Agenda Topics (9:10 AM 9:11 AM) Commission 12. Other Business Allowed by Law (9:11 AM 9:12 AM) Commission 13. Adjournment (9:12 AM 9:13 AM) Commission

3 Meeting of the Commissioners of the Madison Metropolitan Sewerage District Thursday, May 30, :00 a.m. MMSD Commission Board Room, 1610 Moorland Road, Madison, WI Present: Commissioner Caryl Terrell Commissioner Tom Hovel Commissioner Ezra Meyer Commissioner Topf Wells Commission Meeting Call to order: Commissioner Terrell called the meeting to order at 8:00 a.m. 1. Opening A. Welcome Guests 1. Mike Dailey, City of Madison B. Announcements None. 2. Appearances by the Public None. 3. Consent Calendar Discussion: The Commission Meeting Minutes of May 16, Action: Commissioner Wells moved, seconded by Commissioner Meyer that the Commission approve the Consent Calendar.

4 4. Review & Approval of Sewer Extension Plans Presenter: Curt Sauser, Engineering Technician Description: The following sewer extension plans were reviewed and placed on file: Holland Fields Phase 8, Town of Windsor SD#1 Linden Park Phase 10, City of Madison North Military Road, Village of Dane Keyes Avenue Reconstruction, City of Madison Utility Replacement with Resurfacing-2013 (Walter & Johns St.), City of Madison Wheeler Road, Delaware Blvd. & Northland Drive Resurfacing, City of Madison Action: Commissioner Wells, seconded by Commissioner Meyer that the following resolutions be adopted: Attachment: R1 Holland Fields Phase 8, Town of Windsor SD#1 Attachment: R2 Linden Park Phase 10, City of Madison Attachment: R3 North Military Road, Village of Dane Attachment: R4 Keyes Avenue Reconstruction, City of Madison Attachment: R5 Utility Replacement with Resurfacing-2013 (Walter & Johns St.), City of Madison Attachment: R6 Wheeler Road, Delaware Blvd. & Northland Drive Resurfacing, City of Madison Motion carried unanimously. 5. Phosphorus Management Strategy Presenter: Dave Taylor, Director of Special Projects Description: Update on Phosphorus Management Activities Discussion: Mr. Taylor provided an update on various activities associated with the adaptive management pilot project. First he reported that a second Yahara WINs newsletter has been sent to participants. Mr. Taylor then mentioned that a citizen monitoring program is underway and discussions have been held with DNR on

5 developing a water quality monitoring program to support the full scale adaptive management project. The next Yahara WINs meeting is scheduled for June 17 th. Next, Mr. Taylor reported on phosphorus concentration and load information from each of the 4 USGS gauging stations located in the pilot project area, and he noted some upcoming meetings related to phosphorus including a DNR summit on phosphorus implementation issues. Mr. Taylor concluded by briefly presenting and discussing the results of a recent evaluation of pharmaceuticals and personal care products in influent, effluent and biosolids. Action: None. 8. Oral Reports and Updates Topic: Operations Report Presenter: Paul Nehm, Director of Operations and Maintenance Report/Update: Mr. Nehm presented the operations report and noted that effluent quality continues to be excellent. He reported that the amount of water flowing to the treatment plant had increased in April and that pollutant concentrations had decreased. However, the overall loading of these constituents had increased. This was probably due to scouring of the sewers by the higher flow rates. Mr. Nehm noted that Steve Reusser had lowered the dissolved oxygen concentrations in the aeration tanks, which resulted in treatment quality remaining high and energy savings. Mr. Nehm reported that just under 12 million gallons of biosolids had been recycled to farmland this spring and that there is adequate storage capacity for biosolids into September. Lastly, Mr. Nehm noted that one of the new digesters constructed during the 11 th Addition should start filling with biosolids today. Action: None Topic: Commission Discussion-CARPC Update Presenter: Commission Report/Update: No report. Action: None. Topic: Chief Engineer and Director Report Presenter: Michael Mucha, Chief Engineer and Director Report/Update: Mr. Mucha shared that he and Paul Nehm had accepted an invitation to speak on Climate Change and How Does the Treatment Plant Work on-air with local radio, WORT, for the May 27 th 8:00 a.m. Buzz program. Mr. Mucha and Mr. Nehm spoke about the difference of combined sewers versus storm sewers and various aspects of the MMSD treatment processes. Action: None. 9. Future Agenda Topics Action: None.

6 10. Other Business Allowed by Law Action: None. 11. Adjournment Action: Commissioner Wells moved, seconded by Commissioner Hovel that the Commission meeting be adjourned. Motion carried unanimously. Regular Meeting of the Commissioners May 30, 2013 Ezra J. Meyer, Secretary Future Meetings: Thursday, June 13, :00 a.m. Regular Commission Meeting Thursday, June 27, :00 a.m. Regular Commission Meeting Thursday, July 11, :00 a.m. Regular Commission Meeting

7 Attachment: R1 RESOLUTION NO: 1 WHEREAS, plans for sanitary sewer extensions were submitted to the Madison Metropolitan Sewerage District (MMSD) for Holland Fields Phase 8, Windsor Sanitary District No. 1 on May 17, 2013, by Thomas Wordell, D Onofrio, Kottke & Associates., and WHEREAS, the lands to be immediately served are Lots of Holland Fields plat, and Lots and of the First Addition to Holland Fields plat, and WHEREAS, Lots 10, 12 and Outlot 1 of the plat of Holland Fields have been included in the Town of Windsor s Stormwater Management Plan, and have been mapped as being within the environmental corridor by the Capital Area Regional Planning Commission, and WHEREAS, the proposed extension will install 1,198 feet of 8-inch sanitary sewer on Circle Tram Way, Heirloom Drive and Dutch Diamond Way in the Town of Windsor, and WHEREAS, the proposed extensions will connect to the Windsor Sanitary District No. 1 s facilities and MMSD s Northeast Interceptor/Waunakee-DeForest Extension, and WHEREAS, the interceptor and treatment plant connection charges for the lands to be served have not been paid, and WHEREAS, plan review fees are due, and WHEREAS, the MMSD has received a sewer extension review letter # from the Capital Area Regional Planning Commission (CARPC) dated May 6, 2013 stating the CARPC staff has reviewed the proposed extension and determined that it is consistent with the urban service area provisions of the Dane County Water Quality Plan and the Dane County Land Use and Transportation Plan, and WHEREAS, the Chief Engineer and Director of the MMSD recommended the approval of said plans, THEREFORE, BE IT RESOLVED, that the plans for sanitary sewer extensions for Holland Fields Phase 8, Windsor Sanitary District No. 1, submitted on May 17, 2013, by Thomas Wordell, D Onofrio, Kottke & Associates, be approved subject to the following conditions: 1. That Windsor Sanitary District No. 1 shall pay the plan review fee of $1, to the MMSD within 30 days of receiving an invoice for the fee. 2. That interceptor and treatment plant connection charges for Lots 10, 12 and Outlot 1 of the plat of Holland Fields are deferred.

8 3. That prior to connection of said sanitary sewer extensions to sewers within the MMSD s system, the Windsor Sanitary District No. 1 shall have paid to the MMSD the sum of $12, for payment of $9, in Northeast Interceptor/Waunakee-DeForest Extension connection charges and $2, in treatment plant connection charges for the lands to be served, said lands being Lots of Holland Fields plat, and Lots and of the First addition to Holland Fields plat. Said lands are located in the SW1/4 of Section 20, T9N, R10E, north of Gray Road on Windsor s north side. 4. That interceptor and treatment plant connection charge rates are adjusted at the beginning of each calendar year and said connection charges will be due based on the rate for the year in which the payment is made. 5. That, if said interceptor and treatment plant connection charges for the lands to be served remain unpaid after connection of the said sewer extensions to sewers within MMSD s system, appropriate interest on the unpaid balance shall be charged to the Windsor Sanitary District No. 1 by the MMSD. 6. That the Windsor Sanitary District No. 1 shall require the presence of an engineer or an inspector on the construction of said sewer extensions who shall make a record showing in detail the construction as built and shall furnish the MMSD with as-built plans in the case of any significant deviations from the original design. 7. That the construction, operation, maintenance and use of said sewer extensions shall be in accordance with the lawful rules and regulations of the MMSD and with the applicable State of Wisconsin plumbing and sewerage codes. 8. That if construction of the sewer extensions covered by said plans has not commenced within four years following the approval date of this resolution, this approval shall become void and new plans shall be submitted. If construction has commenced but has not been completed within the four-year approval period, the unbuilt portion must be submitted for reapproval if it is a significant portion of the project and would require DNR approval. The above resolution was adopted by the Commissioners of the Madison Metropolitan Sewerage District at their meeting held in the District office on May 30, 2013.

9 Attachment: R2 RESOLUTION NO: 2 WHEREAS, plans for sanitary sewer extension were submitted to the Madison Metropolitan Sewerage District (MMSD) for the Linden Park Phase 10, City of Madison, on May 23, 2013 by Mark Moder, City Engineering Division, and WHEREAS, the project consists of installing 1,572 feet of 8-inch sanitary sewer, a lift station and 1,070 feet of associated 4-inch forcemain on Redan Drive, Shining Rock Trail and Weatherstone Road to serve Phase 10 of the residential subdivision, and WHEREAS, the lands to be served are Lots and Outlots of the plat of Linden Park; and Lots and Lots of the plat of First Addition to Linden Park, and WHEREAS the sewer extension shall connect to the City of Madison s sewerage facilities and MMSD s Lower Badger Mill Creek Interceptor, and WHEREAS, plan review fees are due, and WHEREAS, interceptor and treatment plant connection charges for the lands to be served have not been fully paid, and WHEREAS, interceptor and treatment plant connection charges for part of Lot 283 of Linden Park were previously paid with the 2005 approval of Linden Park Phase 2, and WHEREAS, due to replatting, interceptor and treatment plant connection charges for Lots and 303 of the plat of First Addition to Linden Park have not been fully paid, and WHEREAS, MMSD has received a sewer extension review letter # from the Capital Area Regional Planning Commission dated May 29, 2013 stating the Regional Planning Commission staff has determined that the sewer extension plans are consistent with the urban service area provisions of the Dane County Water Quality Plan and Dane County Land Use and Transportation guide, and WHEREAS, the Chief Engineer and Director of MMSD has recommended the approval of said plans, THEREFORE, BE IT RESOLVED, that the plans for sanitary sewer extensions for Linden Park Phase 10, City of Madison, submitted on May 23, 2013, by Mark Moder, City Engineering Division, be approved subject to the following conditions: 1. That City of Madison shall pay the plan review fee of $1, to the MMSD within 30 days of receiving an invoice for the fee.

10 2. That prior to connection of sewers serving said lands to the public sewerage system, the City of Madison shall have paid to MMSD the sum of $27, for payment of $24, in Lower Badger Mill Creek Interceptor connection charges and $2, in treatment plant connection charges; said lands being Lots and Outlots of the plat of Linden Park; and Lots and Lots of the plat of First Addition to Linden Park. Also included in that amount are unpaid connection charges for part of Lots and 303 of the plat of First Addition to Linden Park. 3. That interceptor and treatment plant connection charges are adjusted at the beginning of each calendar year and said connection charges will be due based on the rate for the year in which the payment is made. 4. That, if said interceptor and treatment plant connection charges for the lands to be served remain unpaid after connection of the said sewer extensions to sewers within MMSD s system, appropriate interest on the unpaid balance shall be charged to the City of Madison by MMSD. 5. That the City of Madison shall require the presence of an engineer or an inspector on the construction of said sewer extensions, who shall make a record showing in detail the construction as built, and shall furnish MMSD with as-built plans in the case of any significant deviations from the original design. 6. That the construction, operation, maintenance and use of said sewer extensions shall be in accordance with the lawful rules and regulations of MMSD and with the applicable State of Wisconsin plumbing and sewerage codes. 7. That if construction of the sewer extensions covered by said plans has not commenced within four years following the approval date of this resolution, this approval shall become void and new plans shall be submitted. If construction has commenced but has not been completed within the four-year approval period, the unbuilt portion must be submitted for reapproval if it is a significant portion of the project and would require DNR reapproval. The above resolution was adopted by the Commissioners of the Madison Metropolitan Sewerage District at their meeting held in the District office on May 30,

11 Attachment: R3 RESOLUTION NO: 3 WHEREAS, plans for sanitary sewer extensions were submitted to the Madison Metropolitan Sewerage District (MMSD) for North Military Road, Village of Dane, on May 8, 2013, by Charles Bongard, MSA Professional Services, and WHEREAS, the project consists of replacing 1,750 feet of 8-inch sanitary sewer on North Military Road and Dane Street in the Village of Dane. The existing sewer is in poor condition and is being replaced in conjunction with the street reconstruction project, and WHEREAS, a slope variance is being requested from the DNR by the Village of Dane for replacement of 218 feet of sanitary sewer which will have less than minimum grade, and WHEREAS, the proposed sanitary sewer extension will connect to the Village of Dane s sewerage facilities and MMSD s Northeast Interceptor/Waunakee-DeForest extension, and WHEREAS, no new areas are being served and no additional flows are anticipated, and WHEREAS, interceptor connection charges for the areas being served have been paid, and WHEREAS, the MMSD has received a sewer extension review letter # from the Capital Area Regional Planning Commission (CARPC) dated May 10, 2013 stating the CARPC staff has reviewed the proposed extension and determined that it is consistent with the urban service area provisions of the Dane County Water Quality Plan and the Dane County Land Use and Transportation Plan, and WHEREAS, the Chief Engineer and Director of MMSD has recommended the approval of said plans, THEREFORE, BE IT RESOLVED, that the plans for sanitary sewer extensions for North Military Road, Village of Dane, submitted on May 8, 2013, by Charles Bongard, MSA Professional Services, be approved subject to the following conditions: 1. That the Village of Dane shall require the presence of an engineer or an inspector on the construction of said sewer extensions who shall make a record showing in detail the construction as built and shall furnish the MMSD with as-built plans in the case of any significant deviations from the original design. 2. That the construction, operation, maintenance and use of said sewer extensions shall be in accordance with the lawful rules and regulations of the MMSD and with the applicable State of Wisconsin plumbing and sewerage codes. 3. That if construction of the sewer extensions covered by said plans has not commenced within four years following the approval date of this resolution, this approval shall

12 become void and new plans shall be submitted. If construction has commenced but has not been completed within the four-year approval period, the unbuilt portion must be submitted for reapproval if it is a significant portion of the project and would require DNR approval. The above resolution was adopted by the Commissioners of the Madison Metropolitan Sewerage District at their meeting held in the District office on May 30, 2013.

13 Attachment: R4 RESOLUTION NO: 4 WHEREAS, plans for sanitary sewer extensions were submitted to the Madison Metropolitan Sewerage District (MMSD) for Keyes Avenue Reconstruction, City of Madison, on May 21, 2013, by Corey Stelljes, City Engineering Division, and WHEREAS, the project consists of removing 6-inch sanitary sewer and replacing with 904 feet of 8-inch sanitary sewer on Keyes Avenue in the City s Dudgeon-Monroe neighborhood. The existing sewer is in poor condition and is being replaced in conjunction with the street reconstruction project, and WHEREAS, the proposed sanitary sewer extension will connect to the City of Madison s sewerage facilities and MMSD s Southwest Interceptor, and WHEREAS, no new areas are being served and no additional flows are anticipated, and WHEREAS, interceptor connection charges for the areas being served have been paid, and WHEREAS, the MMSD has received a sewer extension review letter # from the Capital Area Regional Planning Commission (CARPC) dated May 20, 2013 stating the CARPC staff has reviewed the proposed extension and determined that it is consistent with the urban service area provisions of the Dane County Water Quality Plan and the Dane County Land Use and Transportation Plan, and WHEREAS, the Chief Engineer and Director of MMSD has recommended the approval of said plans, THEREFORE, BE IT RESOLVED, that the plans for sanitary sewer extensions for Keyes Avenue Reconstruction, City of Madison, submitted on May 21, 2013, by Corey Stelljes, City Engineering Division, be approved subject to the following conditions: 1. That the City of Madison shall require the presence of an engineer or an inspector on the construction of said sewer extensions who shall make a record showing in detail the construction as built and shall furnish the MMSD with as-built plans in the case of any significant deviations from the original design. 2. That the construction, operation, maintenance and use of said sewer extensions shall be in accordance with the lawful rules and regulations of the MMSD and with the applicable State of Wisconsin plumbing and sewerage codes. 3. That if construction of the sewer extensions covered by said plans has not commenced within four years following the approval date of this resolution, this approval shall become void and new plans shall be submitted. If construction has commenced but has

14 not been completed within the four-year approval period, the unbuilt portion must be submitted for reapproval if it is a significant portion of the project and would require DNR approval. The above resolution was adopted by the Commissioners of the Madison Metropolitan Sewerage District at their meeting held in the District office on May 30, 2013.

15 Attachment: R5 RESOLUTION NO: 5 WHEREAS, plans for sanitary sewer extensions were submitted to the Madison Metropolitan Sewerage District (MMSD) for Utility Replacement with Resurfacing (Walter St & Johns St), City of Madison, on May 23, 2013, by Mark Moder, City Engineering Division, and WHEREAS, the project consists of replacing sanitary sewers on Walter St., Johns St., Dennett Dr., Hargrove St., Sargent St., as well as crossing a railroad right-of-way, near Olbrich Park on the City s east side. The existing sewer is undersized, prone to inflow/infiltration, and in poor condition. It will be replaced in conjunction with the street resurfacing project, and WHEREAS, the proposed sanitary sewer extension will connect to the City of Madison s sewerage facilities and MMSD s East Interceptor, and WHEREAS, a variance is being requested from the DNR by the City of Madison for a pipe run on Johns Street which is greater than 400 feet in length, and WHEREAS, the Madison Sewer Utility is capable of cleaning sewers up to 700 feet in length, and believes their maintenance program can satisfactorily accommodate the these new sewer mains at the length proposed, and WHEREAS, no new areas are being served and no additional flows are anticipated, and WHEREAS, interceptor connection charges for the areas being served have been paid, and WHEREAS, the MMSD has received a sewer extension review letter # from the Capital Area Regional Planning Commission (CARPC) dated May 29, 2013 stating the CARPC staff has reviewed the proposed extension and determined that it is consistent with the urban service area provisions of the Dane County Water Quality Plan and the Dane County Land Use and Transportation Plan, and WHEREAS, the Chief Engineer and Director of MMSD has recommended the approval of said plans, THEREFORE, BE IT RESOLVED, that the plans for sanitary sewer extensions for Utility Replacement with Resurfacing (Walter St & Johns St), City of Madison, submitted on May 23, 2013, by Mark Moder, City Engineering Division, be approved subject to the following conditions: 1. That the City of Madison shall require the presence of an engineer or an inspector on the construction of said sewer extensions who shall make a record showing in detail the construction as built and shall furnish the MMSD with as-built plans in the case of any significant deviations from the original design.

16 2. That the construction, operation, maintenance and use of said sewer extensions shall be in accordance with the lawful rules and regulations of the MMSD and with the applicable State of Wisconsin plumbing and sewerage codes. 3. That if construction of the sewer extensions covered by said plans has not commenced within four years following the approval date of this resolution, this approval shall become void and new plans shall be submitted. If construction has commenced but has not been completed within the four-year approval period, the unbuilt portion must be submitted for reapproval if it is a significant portion of the project and would require DNR approval. The above resolution was adopted by the Commissioners of the Madison Metropolitan Sewerage District at their meeting held in the District office on May 30, 2013.

17 Attachment: R6 RESOLUTION NO: 6 WHEREAS, plans for sanitary sewer extensions were submitted to the Madison Metropolitan Sewerage District (MMSD) for Wheeler Road, Delaware Boulevard & Northland Drive Resurfacing , City of Madison, on May 23, 2013, by Mark Moder, City Engineering Division, and WHEREAS, the project consists of replacing sanitary sewers on Wheeler Road and Northland Drive on the City s northeast side. The existing sewers are undersized and are being upsized in conjunction with the street resurfacing project, and WHEREAS, the proposed sanitary sewer extension will connect to the City of Madison s sewerage facilities and MMSD s Northeast Interceptor/Waunakee-DeForest extension, and WHEREAS, no new areas are being served and no additional flows are anticipated, and WHEREAS, interceptor connection charges for the areas being served have been paid, and WHEREAS, the MMSD has received a sewer extension review letter # from the Capital Area Regional Planning Commission (CARPC) dated May 29, 2013 stating the CARPC staff has reviewed the proposed extension and determined that it is consistent with the urban service area provisions of the Dane County Water Quality Plan and the Dane County Land Use and Transportation Plan, and WHEREAS, the Chief Engineer and Director of MMSD has recommended the approval of said plans, THEREFORE, BE IT RESOLVED, that the plans for sanitary sewer extensions for Wheeler Road, Delaware Boulevard & Northland Drive Resurfacing , City of Madison, submitted on May 23, 2013, by Mark Moder, City Engineering Division, be approved subject to the following conditions: 1. That the City of Madison shall require the presence of an engineer or an inspector on the construction of said sewer extensions who shall make a record showing in detail the construction as built and shall furnish the MMSD with as-built plans in the case of any significant deviations from the original design. 2. That the construction, operation, maintenance and use of said sewer extensions shall be in accordance with the lawful rules and regulations of the MMSD and with the applicable State of Wisconsin plumbing and sewerage codes. 3. That if construction of the sewer extensions covered by said plans has not commenced within four years following the approval date of this resolution, this approval shall become void and new plans shall be submitted. If construction has commenced but has

18 not been completed within the four-year approval period, the unbuilt portion must be submitted for reapproval if it is a significant portion of the project and would require DNR approval. The above resolution was adopted by the Commissioners of the Madison Metropolitan Sewerage District at their meeting held in the District office on May 30, 2013.

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28 ANCHOR BANK CREDIT CARD CHARGES Billing dates 4/13/2013-5/15/2013 DATE PO # VENDOR DESCRIPTION REQUESTOR AMOUNT ACCOUNT NUMBERS 5/7/ UW Green Bay - Avian QPS Lunch for Dave Taylor re Waters of WI presentation Dave Taylor P /13/ Subway Lunch for Dave Taylor and Kathy Lake re Badfish Creek sampling Dave Taylor P /1/ Indeed.com Maintenance Manager position recruiting Jenni Peters H /16/ Google.com Google Earth Jim Post D /24/ United Airlines Baggage fees - attendance at NACWA Policy Forum - Washington DC - May Michael Mucha C /29/ Subway Lunch for Dave Taylor and Kathy Lake re Yahara WINS meeting Dave Taylor P /23/ Verizon Wireless 3@ Eng Dept. and Janelle Werner IS Dept trial cell phones Info Services G /11/ City of Madison Parking fees re DNR downtown meetings on April 11 Dave Taylor P /11/ Sears Tools Mechanical Dept M /29/ Milwaukee Electrical Tool Clamp meter Electrical Dept E /16/ Farm and Fleet Hip boots and chest waders N /16/ Staples Office chair and notebooks Rick Bultman N /11/ Sears Tools Mechanical Dept M /19/ Amazon.com Rental property replacement sink B & G B /24/ Farm and Fleet Misc. supplies N /30/ Linked In.com April mo. business subscription for recruiting Jenni Peters H /26/ ebay.com Serpentine belts MetroGro R /2/ Farm and Fleet Three-wheel bike N /1/ Optics Planet Inc. Flashlight Electrical Dept E /2/ Farm and Fleet Safety flags for 3-wheeled bikes N /29/ Snap-On Industrial Tools Mechanical Dept M /1/ Walmart.com 52 gallon compost Wizard MPower Team C /15/ WI BADD Registration fee - WI Business Analyst Development Day Amy Bublittz A /19/ City of Madison Parking fees at Monona Terrace - Clean Lakes Alliance meetings on April 19 Dave Taylor P /1/ Subway Lunch re Wellness Walk event on May 1 Wellness Comm N /19/ CSWEA Registration fee - Central States Water Environment Assoc Annual Meeting Tim Stieve D /18/ State Bar Assoc of WI WISBAR Online classified ad Michael Mucha C /17/ Daily Reporter Publishing WI Law Journal - RFP for general legal services Michael Mucha C /2/ TDS Telecom PS 17 USGS monitoring station N /25/ Wellspring Software Print Boss annual service contract renewal Accounting A /23/ Wal-Mart Supplies for April Plant/Safety meeting C /22/ Staples Commissoner signature stamps C /18/ Clean Lakes Alliance Save Our Lakes Summit breakfast attended by Kathy Lake P /3/ Apple Store.com ipad computers for Blooming Grove Fire Department N /6/ Glass Nickel Pizza Public Service Employee Recognition lunch Jenni Peters H /7/ Milio's PCS working lunch Matt Allen D /8/ UW Extension Reg fee - "Perceptual Thinking Patterns: The MInd at Work"-June 11 & 12, 2013 Jenni Peters H00025 Multiple Multiple Meals exp-attendance at NACWA Policy Forum - Washington DC - May Dave Taylor P00024

29 4/25/ Marriott Hotel Lodging- attendance at NACWA Policy Forum - Washington DC - May Dave Taylor P /21 & 24/ Delta and United Airlines Baggage fees - attendance at NACWA Policy Forum - Washington DC - May Dave Taylor P /24/ MSN Airport Parking Airport parking-attendance at NACWA Policy Forum - Washington DC - May Dave Taylor P /9/ Wal-Mart Refreshments for Apprenticeship Advisory Committee meeting May 9, 2013 Dave Lundey D /14/ HyVee Supplies for May Plant/Safety meeting C /25/ Marriott Hotel Lodging- attendance at NACWA Policy Forum - Washington DC - May Michael Mucha C05124 Multiple Multiple Meals exp-attendance at NACWA Policy Forum - Washington DC - May Michael Mucha C /21/ Washington MetroRail MetroRail pass - attendance at NACWA Policy Forum - Washington DC - May Michael Mucha C /7/ Sunprint Café Luncheon meeting with Commissioner Terryl on May 7 Michael Mucha C /3/ DSPS EPAY ISE Backflow preventer online cross connection test/registration Mechanical Dept M00151 $ 10,528.86

30 MADISON METROPOLITAN SEWERAGE DISTRICT 1610 Moorland Road Madison, WI Telephone (608) Fax (608) D. Michael Mucha, P.E. Chief Engineer & Director COMMISSIONERS Caryl E. Terrell President Thomas D. Hovel Vice-President Ezra J. Meyer Secretary John E. Hendrick Commissioner Topf Wells Commissioner Commission Agenda Report Meeting of June 13, 2013 Sewer Extensions Lead Staff: Curt Sauser, Engineering Technician Requested Action: Request a motion to approve 2 sewer extensions: A. Scenic Ridge Phase V, City of Verona B. Uptown Village, City of Fitchburg Financial Impact, Background, Analysis and Options: To be presented at commission meeting Next Steps Upon commission approval, MMSD will forward plans to DNR for consideration of approval.

31 MADISON METROPOLITAN SEWERAGE DISTRICT 1610 Moorland Road Madison, WI Telephone (608) Fax (608) D. Michael Mucha, P.E. Chief Engineer & Director COMMISSIONERS Caryl E. Terrell President Thomas D. Hovel Vice-President Ezra J. Meyer Secretary John E. Hendrick Commissioner Topf Wells Commissioner Commission Agenda Report Meeting of June 13, 2013 Review & Approval of Construction Phase Engineering Services: Pumping Station No. 18 Lead Staff: Bruce Borelli; Director of Engineering Requested Action: Move approval to award Pumping Station No. 18 construction phase engineering services to AECOM, Inc., and that the Chief Engineer and Director be authorized to execute an agreement and/or purchase order with AECOM, Inc., at a cost not to exceed $521,720. Attachments: None. Financial Impact: The anticipated cost for construction related engineering services for Pumping Station is $521,720. This is a budgeted expense that is included in the overall capital budget item for the Pumping Station No. 18 project. The costs will be funded as part of Clean Water Fund Loan the District anticipates to receive for this project. Background: This is a continuation of the work AECOM has performed for the Pumping Station No. 18 project. Their previous work included planning and design of the project. Planning and design began in May of 2011 and will be completed this month. Total planning and design costs for Pumping Station No. 18 were $547,021. The current request is for engineering services related to construction of the project. The scope of work includes the following: Review and track shop drawings/submittals Attend and lead the preconstruction meeting

32 Distribute addenda conformed contract documents Complete remaining work associated with City of Monona approvals Perform field surveying Conduct construction progress meetings and visit site during construction Perform pump witness testing Review and track vendor O&M Manuals Prepare overall pump station O&M Manual Track and respond to Requests for Information Assist with contract administration and change orders Assist with start up and training Prepare record drawings The total cost for this work is estimated at $521,720 and includes approximately 3,800 hours of labor over a period of 1.5 years. MMSD personnel will perform overall contract administration, including issuing change orders, processing pay requests, and performing day to day inspection and on site resident engineering. Analysis and Options Option 1: Award the work to AECOM. This is the recommended option. The proposed cost (4.1% of the estimated construction cost) is reasonable and compares well with past experience: 10 th Addition: Construction engineering services were 4.0% of the construction cost. 11th Addition: Construction engineering services will be approximately 4.5% of the construction cost. PS6/8 Rehabilitation: Construction engineering services were 3.8% of the construction cost. AECOM is the engineer of record for this project and formally approved the plans/specifications during design. They know the details associated with the work and are best suited to perform the engineering services required. They have performed satisfactorily during planning and design, and District staff recommends that they continue to provide engineering related services during construction. Option 2: Award the work to a different consultant. This is not recommended. Bringing a new consultant on board at this time is not practical. A new consultant would need to become familiar with the work and approve construction of work designed by a different firm, which is not preferred. This would cost more and could lead to additional disputes during construction. Option 3: Do not award the services and perform the work in house. This is not recommended. The District does not have the required staff resources or expertise to perform the work required. Next Steps If approved, a construction phase engineering services agreement will be executed and AECOM will begin their scope of work immediately, with completion estimated in early 2015.

33 MADISON METROPOLITAN SEWERAGE DISTRICT 1610 Moorland Road Madison, WI Telephone (608) Fax (608) D. Michael Mucha, P.E. Chief Engineer & Director COMMISSIONERS Caryl E. Terrell President Thomas D. Hovel Vice-President Ezra J. Meyer Secretary John E. Hendrick Commissioner Topf Wells Commissioner Lead Staff: Bruce Borelli; Director of Engineering Commission Agenda Report Meeting of June 13, 2013 Authorization to Proceed with Agreement for Lower Badger Mill Creek Interceptor Phase 3 Requested Action: Move approval to authorize the Chief Engineer & Director to enter into an Agreement with the City of Verona for construction of the Lower Badger Mill Creek Interceptor Phase 3. Attachments: Map. Financial Impact: The City of Verona and Epic have proposed to install approximately 1,200 lineal feet of the Lower Badger Mill Creek Interceptor at their cost. This will save the District approximately $250,000 in future capital improvement costs. Background: The Lower Badger Mill Creek Interceptor serves the western portion of the District, including areas in the City of Verona, the Town of Verona, the Town of Middleton, and the City of Madison. The full length of the interceptor, from Pumping Station 17 to Mineral Point Road, was designed in 2005/2006. Since that time, two phase of the interceptor have been constructed: Phase 1: From Pumping Station 17 to Edward Street (in 2006) Phase 2: From Edward Street to Cross Country Road (in2008) The MMSD Capital Improvement Plan calls for the next phase of the Lower Badger Mill Creek Interceptor to be constructed in 2016.

34 Epic Corporation recently finalized their campus master plan, which includes a major access road which would cross the next phase of the Lower Badger Mill Creek Interceptor. To eliminate future disruption to their campus and associated traffic impacts, Epic has offered to install the next phase of the interceptor at this time. This would be done at their cost before the end of 2013 and represents a savings of approximately $250,000 to the District. To guarantee that the work associated with this is done per MMSD standards, MMSD would enter into an Agreement with the City of Verona. The Agreement would outline all details associated with the work, including design, permitting, easements, interceptor construction, project management, transfer of ownership, liability, etc. The Agreement would require the City of Verona to obtain the necessary services for these items, subject to MMSD approval. The only direct costs to MMSD for this work would be internal labor costs associated with arranging the Agreement, construction inspection, and any other unanticipated work. All other costs would be borne by the City of Verona and/or Epic. Analysis and Options Option 1: Approve moving forward with an Agreement with the City of Verona. This is the recommended option. Details associated with the Agreement are currently being resolved. Once complete, this approval would authorize the Chief Engineer & Director to execute the Agreement. Option 2: Do not approve moving forward with an Agreement with the City of Verona. This is not recommended. The Agreement represents a savings of approximately $250,000 to the District. It also would require the City of Verona to obtain the necessary services associated with the work, thus reducing risks and administration costs to the District. Next Steps If approved, the Agreement with the City of Verona will be finalized and signed by the Chief Engineer & Director. Design and permitting will follow, with interceptor construction scheduled to begin in late summer of this year.

35 Lower Badger Mill Creek Interceptor Future Extension Lower Badger Mill Creek Interceptor Phase 3 Existing Lower Badger Mill Creek Interceptor - Phase 2 Madison Metropolitan Sewerage District Prepared by: JP Approved by: BB Date: Lower Badger Mill Creek Interceptor - Phase 3 6/5/13

36 MADISON METROPOLITAN SEWERAGE DISTRICT 1610 Moorland Road Madison, WI Telephone (608) Fax (608) D. Michael Mucha, P.E. Chief Engineer & Director COMMISSIONERS Caryl E. Terrell President Thomas D. Hovel Vice-President Ezra J. Meyer Secretary John E. Hendrick Commissioner Topf Wells Commissioner Commission Agenda Report Meeting of June 13, 2013 Acceptance of Work: Operations Building HVAC Rehabilitation Mechanical, Inc. Lead Staff: Eric Hjellen, Project Engineer II Requested Action: Move to accept Operations Building HVAC Rehabilitation work in accordance with the attached resolution. Attachments: Attachment 1: Resolution Financial Impact: This is the final contractual payment for construction associated with the Operations Building HVAC Rehabilitation. Project funding came from the Clean Water Fund Loan program, as budgeted in the District s capital improvement program. Background: This project involved a complete rehabilitation of the heating, ventilating and air conditioning (HVAC) system in the Operations Building. The system had suffered numerous operational problems and failures, which led to improper temperature control within the building. Also, portions of the HVAC system were 30 years old and were at the end of their useful life. Mechanical, Inc., was the contractor for the project. They have completed all work included under the Operations Building HVAC Rehabilitation contract, dated July 5, 2011, and have submitted acceptable evidence showing satisfaction of all claims/liens and compliance with the prevailing wage rate requirements of Section of the Wisconsin Statutes. Per the contract, the District will withhold $10, as a maintenance retainer for a period of one year following acceptance of the work.

37 Analysis and Options 1) Scope The scope of the work changed somewhat throughout the project, as witnessed by District staff issuing a total of 33 change orders to address unanticipated items encountered during construction. 2) Schedule Mechanical Inc., struggled to meet project completion dates. This was due to a variety of reasons, including changes in the work, subcontractor issues, sequencing of the work, and lack of project management. A total of three time extensions were granted to Mechanical to complete the work. 3) Budget The final contract price of $2,606, is 4.7% above the original contract price of $2,490, The total contract increase of $116, was split amongst the 33 change orders that were during the duration of the project. A $10,000 maintenance retainer will be withheld for a period of one year following acceptance of work. This will be used to guarantee that any warranty items are quickly and properly addressed. Next Steps None. If approved, the contract with Mechanical, Inc., will end.

38 Attachment 1 RESOLUTION WHEREAS, the Chief Engineer and Director of the Madison Metropolitan Sewerage District has certified that all work included for the Operation Building HVAC Rehabilation contract, between Mechanical, Inc., and the Madison Metropolitan Sewerage District, dated July 5, 2011, has been completed and that acceptable evidence has been submitted showing the satisfaction of all claims/liens, and showing compliance with the prevailing wage rate requirements set forth by Section of the Wisconsin Statutes, WHEREAS, the final contract amount, including all change orders, is $2,606,653.00, which includes a provision that the sum of $10, be withheld by the Madison Metropolitan Sewerage District as a maintenance retainer for a period of one year following acceptance of the work, THEREFORE, BE IT RESOLVED, that said work be accepted, the District reserving to itself all rights under said contract, including guarantees against defects in workmanship, materials, construction or installation, and guarantees against failure to perform successfully within the limits of the specifications, and that final payment be authorized and made to Mechanical, Inc., in the amount of $189,077.48, which amount provides for the withholding of a $10, maintenance retainer from the final contract amount of $2,606, June 13, 2013

39 MADISON METROPOLITAN SEWERAGE DISTRICT 1610 Moorland Road Madison, WI Telephone (608) Fax (608) D. Michael Mucha, P.E. Chief Engineer & Director COMMISSIONERS Caryl E. Terrell President Thomas D. Hovel Vice-President Ezra J. Meyer Secretary John E. Hendrick Commissioner Topf Wells Commissioner Lead Staff: Jeff Brochtrup, Director of Administration Requested Action: Commission approval of financial policies. Attachments: Attachment 1: Draft Financial Policies Financial Impact: No direct financial impact. Commission Agenda Report Meeting of June 13, 2013 Approval of Financial Policies Background: The District has developed a set of draft financial policies as part of a wider effort to prepare a longrange financial strategy, tools and practices. A draft set of these policies was reviewed with the Commission at a study session on March 28, Eric Rothstein of the Galardi Rothstein Group assisted in the preparation of the draft policies. Analysis and Options The adoption of financial policies is a recommended practice for governmental entities such as the District. Adopting these high level policies fosters transparency, establishes basic principles and procedures, and clarifies the expectations and responsibilities of the Commission and staff. The policies in large part continue current District practice. One change from current policy is to increase the transaction limit for items requiring Commission approval. These limits have not been increased for at least 15 years.

40 Based on Commissioner comments received during the March 28 th study session the following changes have been made to the draft policies: Added a statement to the policy objectives section of the Operating Budget and Capital Projects Budget policies regarding controlling expenses consistent with our mission to protect public health and the environment. Added a paragraph to the Transactions Approval Authority policy to authorize staff to expend funds to address emergencies. The strategic financial planning work will continue in 2013 including finishing the financial spreadsheet model and addressing additional policy questions such as risk management and connection charges. Option 1: Adopt the policies as presented in whole or in part as presented or as modified by the Commission. This is the recommended option. Option 2: Send the policies in whole or in part back to staff for further revisions to address concerns the Commission may have. Option 3: Decline to take any action on the proposed policies or postpone action indefinitely. Next Steps If the financial policies are approved staff will conduct the work of the District in accordance with the newly adopted policies. We will also continue other strategic financial planning work.

41 Policy 1 DRAFT Fund Structure 6/10/2013 Madison Metropolitan Sewerage District Commission Policy Statement Re: Fund Structure POLICY OBJECTIVE: The District s Fund Structure Policy is intended to delineate the individual funds to be used to hold and account for the District s financial resources. Funds are accounted for separately and accrue and retain interest earnings. POLICY STATEMENT: The District will hold and account for flows of financial resources in the following funds: Operating Fund Accounts for revenues and expenditures used to support daily operations and maintenance of all District facilities and activities. The primary source of revenue for this fund is service charges. The annual Operating Budget authorizes use of the Operating Fund. o o This fund includes restricted reserve amounts that address Equipment Replacement Fund requirements under the District s Clean Water Fund loan agreements. This fund includes designated reserve amounts to provide for non-cip capital requirements (e.g., Vehicle Replacement) Capital Projects Fund Accounts for revenues and expenditures required to place into service and decommission the District s infrastructure and other capital assets. Revenues to this fund include connection charges and loan proceeds and may include transfers from the Operating Fund. The annual Capital Projects Budget authorizes use of the Capital Projects Fund. Debt Service Fund Accounts for revenues and expenditures required to meet District debt obligations. Revenues to this fund are annual budgeted transfers from the Operating Fund. The annual Debt Service Budget authorizes use of the Debt Service Fund. None of the specific provisions of this statement shall be interpreted to require actions that will frustrate accomplishment of the stated policy objective. Adopted by Commission action on 1

42 Policy 2 DRAFT Strategic Financial Planning 6/10/2013 Madison Metropolitan Sewerage District Commission Policy Statement Re: Strategic Financial Planning POLICY OBJECTIVE: The District s financial planning attempts to anticipate and address regulatory requirements, provide for effective asset repair and replacement, accommodate growth, and provide resilience to address unforeseen circumstances. The District s Financial Planning Policy is intended to ensure that the District has developed an overall strategy for continued financial viability and integrity. POLICY STATEMENT: I. Strategic Financial Plan Submittal and Commission Consideration a) The Chief Engineer and Director shall present a strategic financial plan no less frequently than bi-annually for consideration by the Commission that: Projects system cash-flows for no less than a 10-year forecast horizon Delineates system-wide revenue generation requirements based on: o Stated assumptions related to interest earnings rates on fund balances, and expense escalation factors o Projected Operations and Maintenance expenses o Planned capital improvement project (CIP) expenditures o Planned compliance with the District s established financial policies Projects rates to meet system-wide revenue generation requirements calculated based on projected future plant flow and loadings. The Strategic Financial Plan incorporates the District s six-year Capital Projects Plan and Debt Service Plan, identifying the revenue requirements of these plans in conjunction with projected changes in future Operating Budget requirements. b) The Chief Engineer and Director may, at his discretion, present alternative Strategic Financial Plan scenarios to illustrate the financial implications of alternative District initiatives. c) No Commission action is required following presentation of the Strategic Financial Plan scenarios. None of the specific provisions of this statement shall be interpreted to require actions that will frustrate accomplishment of the stated policy objective. Adopted by Commission action on 1

43 Policy 3 DRAFT Financial Reporting 6/10/2013 Madison Metropolitan Sewerage District Commission Policy Statement Re: Financial Reporting POLICY OBJECTIVE: The District s Financial Reporting Policy is intended to ensure timely and accurate reporting of financial information to facilitate resource allocation decision-making by the District s Commission and management. POLICY STATEMENT: I. Annual Financial Reporting a) The Chief Engineer and Director shall submit to the Commission annual, audited financial statements. II. Mid-Year Reporting a) The Chief Engineer and Director shall submit to the Commission within 90 days of the midpoint of the then current fiscal year the following financial reports: O&M Expenses: Budget vs. Actual reporting of fiscal year to date (thru midpoint) Operating Fund actual expenditures and end-of-year estimated Operating Fund expenditures relative to budget. Capital Projects Expenditures: Planned vs. Actual reporting of fiscal year to date (thru mid-point) Capital Projects Fund actual expenditures and end-of-year estimated Capital Projects Fund expenditures relative to budget. No Commission action is required based on the annual reporting though reports may suggest needs for budget amendments per the Operating Budget, and Capital Projects Budget and Debt Service Budget Policies. None of the specific provisions of this statement shall be interpreted to require actions that will frustrate accomplishment of the stated policy objective. Adopted by Commission action on 1

44 Policy 4 DRAFT Operating Budget 6/10/2013 Madison Metropolitan Sewerage District Commission Policy Statement Re: Operating Budget Development and Approval POLICY OBJECTIVE: The District s Operating Budget Development and Approval Policy is intended to ensure that plans for expenditure of District funds are developed and approved by the Commission under a defined schedule that will provide for stakeholder review and engagement. The District desires to control expenses and service charge rates consistent with our mission to protect public health and the environment. This policy clarifies when staff must obtain approvals for changes to the Operating Budget. POLICY STATEMENT: I. Definitions Operating Budget is the annual financing plan for the budget year s anticipated Operating Fund expenditures. Proposed Operating Budget is the Chief Engineer and Director s annual budget recommendation for the upcoming calendar fiscal year. The Proposed Operating Budget becomes the Operating Budget after review and adoption by the Commission. II. Budget Organization a) The Operating Budget shall be structured so that costs can be accumulated by line item, expense category, and cost center. b) Each cost center shall develop its budget requests by line item and expense categories for accountability and control purposes. These budget requests shall include authorized actual and proposed staffing levels for each cost center. A formal statement of operating objectives shall accompany each cost center s detailed budget request. c) The proposed budgets of the departments will be submitted to the Director of Administration and the Chief Engineer and Director. d) The Operating Budget is a financial plan. Operating expenditures shall not exceed the approved Operating Budget (as may be amended) in total. 1

45 Policy 4 DRAFT Operating Budget 6/10/2013 III. Budget Development a) The Chief Engineer and Director shall submit annually a recommended Operating Budget of operating and maintenance expenditures and estimated revenues for the ensuing calendar year. The Operating Budget expenditures shall include transfers to the Debt Service Fund and may include transfers to the Capital Projects Fund. b) The Chief Engineer and Director, with the Commissioners approval, shall establish a calendar for public hearings and the Commission s review of the Proposed Operating Budget. The Proposed Operating Budget is subject to a public hearing preceded by a public notice pursuant to Wis. Statutes Ch A summary of the proposed budget shall be made available for public inspection at least 15 days prior to the public hearing. A notice of the public hearing shall be published at least 15 days prior to the public hearing. i. The Chief Engineer and Director may provide for additional public hearings or meetings with interested stakeholder groups to review the proposed Operating Fund budget at his/her discretion, subject to compliance with the Commission approved public hearing schedule. c) The Commission shall review the proposed Operating Budget. The Commission may amend the proposed Operating Budget through normal budget deliberations. d) The Proposed Operating Budget is subject to change either through Commissionsponsored or staff-sponsored amendments. The Proposed Operating Budget becomes a Operating Budget for the succeeding fiscal year when the Commission adopts an approving resolution(s) following consideration of the Proposed Operating Budget ; comments of the public following the noticed public hearing on the Proposed Operating Budget; staff-proposed amendments ; and commissioner-sponsored amendments. IV. Commission Action, When Required a) Commission action is required to authorize the following: i. The adoption of the annual Operating Budget including adoption of amendments to the Proposed Operating Budget (majority vote). ii. iii. Amendments to the adopted budget that change total authorized expenditures. Such amendments require a 2/3 vote of all commissioners and the publication of a class 1 notice of the change within 10 days per Wis. Statutes Ch The adoption of amendments to the Operating Budget (majority vote) that change the amount to be transferred to the Debt Service Fund. 2

46 Policy 4 DRAFT Operating Budget 6/10/2013 V. Chief Engineer and Director Responsibility a) The Chief Engineer and Director shall ensure that the annual expenditures do not exceed the total funds budgeted. When it is apparent that the Operating Budget total will be exceeded, a request for a budget amendment shall be brought to the Commission, prior to an overrun. b) Within the limits of authority delegated by this or other Commission policy or action, the Chief Engineer and Director may, without further Commission approval during the budget year, authorize the transfer of budgeted funds between any cost centers within the total approved Operating Budget, except that changes to the amount budgeted for transfer to the Debt Service Fund requires Commission approval via a budget amendment None of the specific provisions of this statement shall be interpreted to require actions that will frustrate accomplishment of the stated policy objective. Adopted by Commission action on 3

47 Policy 5 DRAFT Capital Projects Budget 6/10/2013 Madison Metropolitan Sewerage District Commission Policy Statement Re: Capital Projects Budget and Debt Service Budget Development and Approval POLICY OBJECTIVE: The District s plans for capital expenditure and financing are intended to effectively develop and maintain the District s infrastructure assets to meet the demands of growth and timely repair and replacement. The Capital Projects Budget and Debt Service Budget Development and Approval Policy is intended to ensure that the District s capital project expenditure and financing plans are developed and approved by the Commission under a defined schedule that will provide for stakeholder review and engagement. The District desires to control expenses and service charge rates consistent with our mission to protect public health and the environment. This policy clarifies when staff must obtain approvals for changes to the Capital Projects and Debt Service Budgets. POLICY STATEMENT: I. Definitions In this policy, the following words and phrases (listed alphabetically) have the meanings indicated below. Capital Projects Budget is the annual financing plan for the budget year s anticipated Capital Projects Fund expenditures. Capital Improvements Plan (CIP) is the 6-year plan identifying projects, total project costs, and the estimated project costs for each year of the plan. The plan provides information on the level and type of future capital expenditures and identifies sources of funds and anticipated capital expenditures in each year of the plan. Debt Service Budget is the annual plan for transfers to and disbursements from the Debt Service Fund. Debt Service Plan is the 6-year plan identifying planned transfers to and scheduled disbursements from the Debt Service Fund. "Project" means any of several activities that are integrally related to and may result directly in the creation of or modifications to a District asset. Such activities include, but are not limited to, feasibility studies, facilities planning studies, engineering and design studies and plans, and construction. A single project may consist of one or more of these activities, and may or may not include construction, and, in general, has a cost of $100,000 or more. 1

48 Policy 5 DRAFT Capital Projects Budget 6/10/2013 Proposed Capital Projects Budget is the Chief Engineer and Director s annual budget recommendation for the upcoming calendar fiscal year. The Proposed Capital Projects Budget becomes the Capital Projects Budget after review and adoption by the Commission. Proposed Debt Service Budget is the Chief Engineer and Director s annual budget recommendation for the upcoming calendar fiscal year. The Proposed Debt Service Budget becomes the Debt Service Budget after review and adoption by the Commission. "Total Project Cost" includes all estimated costs for activities to complete a single project over one or more years. II. Capital Projects Budget and Debt Service Budget Development A. The Chief Engineer and Director shall annually submit to the Commission the following for Commission action: 1. Total Project Costs A list of all projects previously approved, all projects new to the current budget year, and a list of all existing projects that have changed estimates of previously approved total project cost along with the estimated costs to complete each project. Commission action on the Total Project Costs and the Capital Projects Budget allows expenditures of project funds subject to other pertinent statutory or policy requirements including policies related to Commission approval of contracts and other transactions and the District s procurement policy. 2. Capital Improvements Plan - The plan identifies projects and anticipated sources of funds for capital expenditures in each year of the 6-year plan. Commission action on the Capital Improvements Plan (CIP) approves capital projects, expenditures and the financial plan for planning purposes only. It does not authorize expenditures, sources of funds, the tax levy, or the amount of the tax levy to be abated in subsequent years. Commission approval of the Capital Projects Plan records an indication of the projects the Commission plans to move forward with in the future. 3. Capital Projects Budget - The annual financing plan for a fiscal year s anticipated expenditures. The budget identifies projects, expenditures, and sources of funds for capital expenditures for the budget year. It also includes a summary of actual revenues and expenditures for the preceding calendar year and an estimate of 2

49 Policy 5 DRAFT Capital Projects Budget 6/10/2013 revenues and expenditures based on the first six months (or most current actual data) for the current calendar year. Commission approval of the Capital Projects Budget identifies the amount of the tax levy and other sources of funds anticipated for the budget year s capital expenditures. Approval of the Capital Projects Fund Budget by the District s Commission authorizes expenditures of funds subject to other pertinent statutory or policy requirements including policies related to Commission approval of contracts and transactions and the District s policy for procurements. 4. Debt Service Budget - The annual plan for a fiscal year s anticipated transfers to and disbursements from the Debt Service Fund to meet District debt obligations. Commission approval of the Debt Service Budget authorizes the amount of Operating Fund transfers to and debt service payments for the budget year s debt service obligations. 5. Debt Service Plan - The plan identifies planned transfers to and scheduled disbursements from the Debt Service Fund for a six-year period. Commission action on the Capital Improvements Plan (CIP) approves the plan for incurrence of debt obligations and servicing for the budget year and the next five years required to support the District s Capital Projects Plan. B. The Chief Engineer and Director, with the Commissioners approval, shall establish a calendar for public hearings and the Commission's review of the Proposed Capital Projects Budget and Debt Service Budget. The Proposed Capital Project Budget and Proposed Debt Service Budget are subject to a public hearing preceded by a public notice pursuant to Wis. Statutes Ch The District s proposed capital project expenditure and financing plans shall be made available for public inspection at least 15 days prior to the public hearing. These plans consist of the District s: (1) Capital Improvements Plan, (2) Debt Service Plan, (3) Proposed Capital Projects Budget, and (4) Proposed Debt Service Budget (collectively referred to as the District s capital projects expenditure and financing plans ). A notice of the public hearing shall be published at least 15 days prior to the hearing. The Chief Engineer and Director will also send written notice of the proposed budget and budget hearing to the District s customer communities in advance of the public hearing. 1. The Chief Engineer and Director may provide for additional public hearings or meetings with interested stakeholder groups to review the proposed capital project expenditure and financing plans at his/her discretion, subject to compliance with the Commission approved public hearing schedule. 3

50 Policy 5 DRAFT Capital Projects Budget 6/10/2013 C. The Commission shall review the proposed Capital Improvements Plan and may amend it through normal budget deliberations. D. The Proposed Capital Projects Budget and the Proposed Debt Service Budget are subject to change either through Commission-sponsored or staff-sponsored amendments. The Proposed Capital Projects Budget becomes a Capital Projects Budget for the succeeding fiscal year when the Commission adopts an approving resolution(s) following consideration of the Proposed Capital Projects Budget ; comments of the public following the noticed public hearing on the Proposed Capital Budget; staff-proposed amendments ; and commissioner-sponsored amendments. The same procedure holds for the Debt Service Budget review and adoption. III. Commission Action, When Required A. Commission action is required for the following: 1. Approval of the annual Capital Projects Budget and the Debt Service Budget (majority vote). 2. Amendments to the adopted Capital Projects Budget that increase the Capital Projects budget total: The resolution presented to the District Commission for approval must include the sources and uses of funds in the amendment. Approval of amendments to an adopted budget requires a 2/3 vote of all commissioners and the publication of a class 1 notice of the change within 10 days per Wis. Statutes Ch The addition of a new project not included in the adopted Capital Projects Budget. The resolution presented to the Commission for approval must describe the Total Project Cost, including the amount estimated to be spent in the current year and over the life of the project. a. If funds are available within the Capital Projects Budget without increasing the Capital Budget total, a simple majority vote is needed. b. If funds are transferred from the Operating Fund a two-thirds vote is required in accordance with State law. 4. Approval to increase a previously approved total project cost. 5. The issuance of bonded debt and notes or promissory notes to finance the Capital Projects Budget. 6. The issuance of municipal obligations in anticipation of receiving proceeds from Clean Water Fund Program loans. 4

51 Policy 5 DRAFT Capital Projects Budget 6/10/ The levying of property taxes. IV. Force Account Approval of the Capital Projects Budget authorizes force account expenditures (District staff time and expenses) upon the effective date of the budgets adopted by the Commission. V. Project Cost Carryover Project costs approved for expenditure in the previous year s capital projects budget but not expended in that year can be carried over and expended in the succeeding budget year without additional approval by the Commission. The approved total project cost shall not be exceeded without prior approval of the Commission. VI. Chief Engineer and Director Responsibility A. The Chief Engineer and Director shall ensure that Capital Projects expenditures do not exceed the total funds budgeted (as may be amended) for the year and that the total project costs for a project do not exceed the approved amount. 1. When it is apparent that budgeted total Capital Projects expenditures will be exceeded a request for a budget amendment shall be brought to the Commission prior to an overrun. 2. When it is apparent that the approved total project costs for a project will be exceeded a request for a project cost amendment shall be brought to the Commission prior to an overrun. B. The Chief Engineer and Director shall ensure that required Debt Service payments are made as required to meet District debt obligations. None of the specific provisions of this statement shall be interpreted to require actions that will frustrate accomplishment of the stated policy objective. Adopted by Commission action on 5

52 Policy 6 DRAFT Transaction Approval 6/10/2013 Madison Metropolitan Sewerage District Commission Policy Statement Re: Transaction Approval Authority POLICY OBJECTIVE: The District s Transaction Approval Authority Policy addresses requirements for approval of financial transactions including, but not limited to, contracts, professional services agreements, equipment purchases, settlement agreements, and other arrangements. This policy addresses transactions requiring Commission approval and transactions that may be approved by the Chief Engineer and Director. POLICY STATEMENT: The District s Transaction Approval Authority Policy establishes controls on District transactions to ensure that the allocations of District resources are subject to appropriate levels of review and consideration. The Operating Budget, Capital Projects Budget, and Debt Service Budget authorize expenditures subject to State law, this policy and other District policy. I. Chief Engineer and Director Responsibility a. Chief Engineer and Director is responsible for Operating Fund transactions as follows: The Chief Engineer and Director shall ensure that the annual Operating Budget expenditures do not exceed the total funds budgeted. When it is apparent that the Operating Budget total will be exceeded, a request for a budget amendment shall be brought to the Commission, prior to an overrun. The Chief Engineer and Director may, without further Commission approval during the budget year, authorize the transfer of budgeted Operating Budget funds between any cost center within the total approved budget within the limits of authority delegated by this or other Commission policy or action except that changes to the budgeted amount transferred to the Debt Service Fund requires Commission approval. b. Chief Engineer and Director is responsible for Capital Projects Fund transactions as follows: Within the limits of authority delegated by Commission policy or action, the Chief Engineer and Director may, without further Commission approval during the budget year, execute contracts, contract amendments or contract modifications, or change project schedules provided that: 1

53 Policy 6 DRAFT Transaction Approval 6/10/2013 o o Total spending for the individual affected Capital Project of the Capital Projects Budget, as approved by the Commission, is not exceeded, and Total capital project expenditures do not exceed that budgeted for the Capital Projects Budget in aggregate. II. Commission Approval a. Generally, Commission approval of the Operating Budget and Capital Projects Budget authorizes expenditures except as noted below. i. Commission approval is required for Operating Fund transactions as follows: o o Non-routine, individual Operating Fund expense transactions exceeding $50,000. Non-routine transactions typically require bids or a contract. Routine transactions, for example, include utility bills. Professional services contract awards exceeding $50,000 or amendments to these contracts exceeding 10% of the original contract amount. ii. Commission approval is required for all Capital Projects Fund transactions as follows: o Construction contract awards Construction contracts awards exceeding $100,000 For construction contracts exceeding $100,000 and less than $500,000, amendments to these contracts exceeding 10% of the original contract amount. For construction contract awards exceeding $500,000, amendments to these contracts exceeding 5% of the original contract amount. o Equipment purchases exceeding $100,000. o Professional services contract awards exceeding $50,000 and amendments to these contracts exceeding 10% of the original contract amount. iii. The Chief Engineer and his/her designee(s) is authorized to expend monies to address emergencies. Emergency situations are those which require immediate action to protect public health and safety, employee safety, the environment, or property. Management shall use reasonable judgment and control of purchases during such events and shall report to the Commission those purchases exceeding the normal limits as soon as is practically possible. VII. Transaction Reporting The Chief Engineer and Director shall prepare a monthly report summarizing all transactions in the Operating Fund, Capital Projects Fund, and the Debt Service Funds. 2

54 Policy 6 DRAFT Transaction Approval 6/10/2013 None of the specific provisions of this statement shall be interpreted to require actions that will frustrate accomplishment of the stated policy objective. Adopted by Commission action on 3

55 Policy 7 DRAFT Fund Reserves 6/10/2013 Madison Metropolitan Sewerage District Commission Policy Statement Re: Fund Reserves POLICY OBJECTIVE: The District s Reserves Policy is intended to ensure that the District has adequate working capital to meet financial demands of unforeseen circumstances, provide adequate liquidity to support efficient operations, and secure debt obligations. POLICY STATEMENT: The District will maintain reserves in each of its funds as delineated below. In the event that unforeseen circumstances necessitate the use of available reserves in any of its funds, the District will restore the designated reserve amount within one-to three years of its depletion below the targeted minimum endof-year reserve level. Operating Fund Reserves the District will maintain a targeted end-of-year minimum balance in its Operating Fund equal to the sum of: o o 180 days of budgeted Operating Expenses (exclusive of debt service obligations) the greater of $3,000,000 or the Equipment Replacement Fund 1 requirements of the Wisconsin Clean Water Fund (CWF) program. Capital Projects Fund Reserves the District will target a minimum end of year balance in its Capital Project Fund of the greater of $3 million dollars or 10% of the planned capital project expenditures for the forthcoming fiscal year. Debt Service Fund Reserves the District will maintain a minimum Debt Service Fund balance as prescribed by the terms of its current and projected CWF and other indebtedness obligations. Balances in excess of minimum requirements, due to transfers, interest accruals or debt retirements, may be applied to District debt obligations. None of the specific provisions of this statement shall be interpreted to require actions that will frustrate accomplishment of the stated policy objective. Adopted by Commission action on 1 The District maintains an Equipment Replacement Fund for unbudgeted emergency repair and replacement as restricted funds of the Operating Fund and provides for regular equipment replacement requirements through Operating Fund budgeting. 1

56 Policy 8 DRAFT Debt Financing 6/10/2013 Madison Metropolitan Sewerage District Commission Policy Statement Re: Debt Financing Policy POLICY OBJECTIVE: The District s capital project financing policy related to the incurrence of debt obligations is intended to ensure an appropriate balancing of the use of District equity (e.g., cash, pay-as-you-go) and various forms of debt obligations to minimize rate increases while ensuring strong financial performance and the ability to obtain debt on favorable terms. POLICY STATEMENT: The District will generally employ the State of Wisconsin s Clean Water Fund loan program to finance eligible capital projects. o The District will incur other debt obligations to finance capital projects (or portions thereof) for which no other funding source is available. All debt-financed capital projects must render capital assets with expected service lives that equal or exceed the term of the associated debt obligations. In the event that debt obligations are employed, the District will consider use of alternative forms of debt to limit financial risks and mitigate potential rate impacts. The District will target current revenue or capital fund balance financing of recurring capital projects (e.g., annual pipeline replacements) to the extent that equity financing will not impose rate increase requirements (that may be deferred through use of debt). None of the specific provisions of this statement shall be interpreted to require actions that will frustrate accomplishment of the stated policy objective. Adopted by Commission action on 1

57 MADISON METROPOLITAN SEWERAGE DISTRICT 1610 Moorland Road Madison, WI Telephone (608) Fax (608) D. Michael Mucha, P.E. Chief Engineer & Director COMMISSIONERS Caryl E. Terrell President Thomas D. Hovel Vice-President Ezra J. Meyer Secretary John E. Hendrick Commissioner Topf Wells Commissioner Lead Staff: Jeff Brochtrup, Director of Administration Requested Action: For information. Attachments: None. Commission Agenda Report Meeting of June 13, 2013 Capital Project Financing Options Financial Impact: If the District goes forward with a more complete analysis of competitive market financing several thousand dollars of budgeted amounts for contracted services will be expended on financial advisor fees. This may not be needed. Background: The District has had a long time policy of using debt financing for those construction projects which can t be funded by connection charge revenues. Since the early 1990s all our debt has been through the State of Wisconsin Clean Water Fund (CWF). Historically the CWF loan rates have clearly been a better deal for the District than the closest competition, competitive market general obligation bonds. The gap between CWF rates and competitive market rates has narrowed substantially and the question has been raised as to whether CWF financing is still the best deal for the District. Analysis and Options The question comes down to whether the competitive market can beat CWF rates. To help answer this question two firms active in the Wisconsin municipal bond market volunteered to provide preliminary analyses of the cost of non CWF bond financing. The two firms were Robert W. Baird and Co. and Springsted Incorporated. Baird serves as the financial advisor to the Milwaukee Metropolitan Sewerage District and Springsted serves as financial advisor to the City of Madison and the Madison Water Utility. 1

58 The current CWF subsidized interest rate is 2.625% based on a market rate of 3.5% and a 25% interest rate subsidy. The CWF funds project costs at the subsidized rate except for costs to cover capacity beyond 10 years from the project completion date and capacity to serve any industrial user with a flow equivalent of 25,000 gallons per day. The CWF funds at market rate project costs to cover capacity beyond 10 years from the project completion date and the capacity to serve any industrial user with a flow equivalent of 25,000 gallons per day. The actual CWF loan rate for a project will depend on the split of project costs between those eligible for the subsidized interest rate and the market interest rate. For the remaining loans the District plans to get in 2013 I expect our CWF loan rates to vary from 2.625% to 2.756%. Project Cost Estimate CWF Interest Rate Process Control System $4.9 million 2.625% Pumping Station 18 $16.1 million 2.645% PS 18 Force Main $14.1 million 2.756% Baird and Springsted Preliminary Analysis of Competitive Bond Rates The Baird preliminary analysis showed that the CWF was still our low cost option with an estimated all included cost interest rate of 2.83% for a competitive market bond compared to 2.625% for a CWF loan. Our highest estimated interest rate for our the CWF loans is less than 2.83% so the Baird analysis would suggest there is no cost advantage going with a competitive loan. The Baird analysis assumed an Aaa rating. The Springsted preliminary analysis assumed a Aa1 rating and showed a virtual tie between the Clean Water Fund and competitive market rates. Their analysis showed that at loan rates near 2.625% the CWF had slightly lower total principal and interest payments (~$75,000 for a $30.0 million issue). For a CWF loan rate of 2.80% their analysis would show slightly lower total principal and interest payments (~$240,000 for a $30.0 million loan) for the CWF loan. To put these numbers in context a $30.0 million loan at an interest rate of 2.625% would have an annual principal and interest payment of $1.95 million. The Springsted analysis showed that the CWF program is the low cost option for the Process Control System and the Pumping Station 18 project financing by a small margin. Principal and interest costs for those CWF loans were estimated to be a combined $45,000 lower than for a competitive bond. The competitive bond interest rate may beat the CWF rate for the PS 18 Force Main project. The numbers are close and dependent on the CWFP and market interest rates. The Springsted analysis estimated a potential savings of about $164,000 over the life of that loan, about $8,200 per year, using competitive bonds. Some of the principal and interest savings would be offset by higher issuing costs for the non CWF bond. There is also a risk that if we go to the market the rates offered may be higher than the preliminary analysis suggested and in that case the potential savings could not materialize or even result in higher costs than a CWF loan. Since the PS 18 Force Main project is scheduled to bid in fall this we can watch the market and make a financing decision for that loan in a few months. 2

59 Competitive bond financing is likely to be advantageous to the District if the CWF subsidy decreases or the District is eligible for bank qualified financing. Bank qualified bond financing is available for entities issuing less than $10 million of general obligation debt in a year. The bank qualified rates are now averaging 0.50 to 0.70 percentage points lower than the rates we discussed in this memo. Our financing needs exceed the $10 million threshold for The bank qualified competitive bond is an option for us to consider in future years. Other Considerations Staff s opinion is that, on balance, the other considerations shown in the table favor Clean Water Fund financing in CWF Funding Competitive Bonds Advantage Provides just in time money via monthly loan draws during construction minimizing financing costs. Requires recipient to get proceeds as lump sum up front or to go to the market multiple times to better match demand. Either option increases cost, either debt service costs or staff time. CWF Provides funding for the project as needed up to a maximum loan amount. The loan is right sized. Minimizes loan costs and District staff time to manage the money. Additional requirements such as Davis Bacon, DBE documentation Staff is familiar with CWF requirements. No learning curve. Simple financial planning for CIP. Provides a set amount of money which must be expended within two years. Additional effort will be required of staff as new financial management elements need to be managed. Complicates our CIP financial planning. Has reduced regulatory requirements (Davis Bacon, DBE documentation, etc.) reducing engineering staff costs for bidding and construction. Finance and accounting staff would have extra work to learn and implement requirements for competitive bond market financing. CWF Competitive market bond CWF Bond market interest rates have been edging up in recent months. A continuation of this trend would favor CWF financing. The Wisconsin legislature s Joint Committee on Finance has approved provisions to fund the CWF program for the biennium at the same 25% interest rate subsidy as for the biennium. If the approved budget maintains those provisions going forward and bond market interest rates continue to increase, moving closer to normal historical levels, then the CWF will clearly be the District s lowest cost source of long term debt financing except where we might meet the bank qualified standard. 3

60 If the District is interested in getting a bond rating in order to demonstrate that we are in good financial shape we can have a preliminary rating done separate from a bond issue. The estimated cost for a preliminary rating by Moody s is $13,000. Options For 2013 Option 1: Proceed with CWF loans for the Process Control System and Pumping Station 18 projects. We plan to bid the PS 18 Force Main project in late September If market trends over the next several months or CWF program changes show that the spread between CWF rates and market rates is moving in favor of competitive financing, then undertake the selection of a financial advisor and take a more thorough look at competitive financing for the PS 18 Force Main project. Staff leans towards CWF financing unless the potential savings in market rate financing is greater than now estimated. As it is, the potential savings do not justify a major change in our project financing approach and the extra work involved for District staff. This is the recommended option. Option 2: Proceed with CWF loans for the Process Control System and Pumping Station 18 projects and commit now to selecting a financial advisor for the PS 18 Force Main project. This option would involve commitment of staff time and some budget dollars for the financial consultant. Rough cost estimate is $4,000 to $6,000. (Staff time of $2,500 to $3,000; financial advisor fees $1,500 to $3,000. Staff time cost estimate assumes a request for proposal and interview process is used to select a financial advisor.) We may also want to obtain a preliminary rating at an estimated cost of $13,000. There would be additional staff time needed to provide information for a rating. For 2014 and beyond Continue to track CWF and competitive bond interest rates. Look for opportunities to use competitive bank qualified bonds. Evaluate options annually. Next Steps Our intention is to proceed with Option 1 which would be to obtain CWF financing for the Process Control System and Pumping Station 18 projects and to take another look at funding for the PS 18 Force Main project as we get closer to when we need the funding. 4

61 MADISON METROPOLITAN SEWERAGE DISTRICT 1610 Moorland Road Madison, WI Telephone (608) Fax (608) D. Michael Mucha, P.E. Chief Engineer & Director Upcoming Agenda Items Commission Meeting Date Note: All dates are tentative and subject to change Meeting Finalized Meeting/Event 6/13/2013 X Commission Meeting 6/27/2013 X Commission Meeting & Study Session Potential Agenda Items Review and Approval of Sewer Extension Plans-Sauser o Scenic Ridge-Phase 5, City of Verona o Uptown Village, City of Fitchburg Cash Statements Review and Approval of Construction Phase Engineering Services-PS18-Borelli COMMISSIONERS Caryl E. Terrell President Thomas D. Hovel Vice-President Ezra J. Meyer Secretary John E. Hendrick Commissioner Topf Wells Commissioner (Note: routine business is shown in smaller font) Authorization to Proceed with Agreement for Lower Badger Mill Creek Interceptor-Phase 3-Borelli Acceptance of Work-Operations Building HVAC Rehabilitation-Hjellen Approval of Financial Policies-Brochtrup Capital Projects Financing Options-Brochtrup Review and Approval of Sewer Extension Plans-Sauser o Middleton Ridge at Misty Valley-Phase 3, City of Middleton Approval of Staffing Study and Recommendation-Nehm Approval of Space Needs Study and Recommendations- Borelli/Bray Tentative: Review and Approval of CMAR-Allen Tentative: Pumping Station 18 Forcemain Project Update-Borelli Tentative: Review of Bids and Award of Contract: Pumping Station 18-Borelli Phosphorus Management Strategy-Taylor 6/27/2013 STUDY SESSION Proposed 2014 Capital Improvements Plan 7/11/2013 X Commission Cash Statements Meeting Review and Approval of Sewer Extension Plans-Sauser o Pumping Station 18 Forcemain Review and Approval of Design Engineering Service: PS11 & PS12 Rehabilitation-Borelli Approval of 2 nd Quarter 2013 Sewer Service Bills-Gebert Review and Approval of Proposed 2014 Capital Improvements Plan